Beaver County Times & Allegheny Times
04/09/2006
Duquesne Light asks for rate hike
Stephanie Waite, Times Business Editor

PITTSBURGH - Duquesne Light Co. on Friday asked the state Public Utility Commission to approve its first base rate increase since 1988, a move that would take customers' bills back to prederegulation levels.

The review of the rate increase request, which will include opportunities for public comment, is expected to take nine months. If approved, new rates would probably go into effect in early January 2007.

The rate request covers distribution and transmission costs, not the cost of electricity itself. Those costs are fixed through 2007 for customers who buy their electricity from Duquesne Light.

The proposed rate hike illustrates the failure of deregulation in Pennsylvania, said David Hughes of Citizen Power, a Pittsburgh-based energy advocacy organization.

Deregulation seemed like a success in 2002 when Duquesne Light cut its rates by 16 percent after selling its power plants and paying off stranded costs from the building of Beaver Valley Nuclear Power Station in Shippingport. The idea was that competitors then would enter the electric business and keep consumers' costs down.

"We didn't get what we were promised," Hughes said. "We still have monopolies. ... If there were real competition, chances are Duquesne Light couldn't come in with a proposed increase."

Competition isn't realistic for the electric business, which requires big capital investments and offers a low profit margin per kilowatt hour, Hughes said.

The PUC filing includes a request for substantial increases in funding for Duquesne Light's Customer Assistance Program, so that low-income customers' monthly bills should be essentially unchanged.

Hughes said his group will be reviewing the request but noted that utilities typically ask for more than they expect will be approved.

ęBeaver County Times Allegheny Times 2006